Buying A Home: The Launch FCU Guide
Buying your first home is one of the biggest purchases you will make during your lifetime, and it may also be one of the most exciting. However, buying a home is far different than buying a new pair of shoes, a bike, or even a car. There are many great benefits of owning a home; however, buying a home is a huge responsibility, and takes careful consideration and a lot of planning. Here are five questions to ask yourself before you make the jump from renting to owning.
5 Question to ask before buying a home?
1. Are my finances in order?
One very important element to take into consideration is your current financial situation. Do you have a lot of credit card debt, student loans, or personal loans? Having a car loan, credit card, or student loans does not mean that you are not able to buy a home; however, you just want to make sure that you will be able to afford your monthly mortgage payment on top of your other monthly financial responsibilities.
2. Am I prepared to pay for home maintenance?
One of the benefits of living in an apartment or condo is that many things such as lawn care, maintenance, and pest control are taken care of for you. When you make the move from renting to owning you may be responsible for property taxes, insurance, city assessments, water, sewer, garbage, utilities, fixing your own appliances, repairing your roof, mowing your lawn, paying for pest control, and more. If you buy a home that is part of a home owners association, you may not be responsible for some of these costs; however, you will probably be responsible for paying a monthly HOA fee.
3. Do I plan to stay in the area?
According to Time Money, the old rule of thumb is that you should plan to stay in your new home for at least three to five years. Some financial advisers are recommending an even longer window today. The cost of moving can be quite expensive, so making sure that you really like an area before moving in is a must.
4. Is my job secure?
Do you plan on staying in your job for a while? If you foresee an upcoming career switch, make sure it would not result in a two hour commute to work every day, or even a move out of state. Buying a home is a huge commitment, that’s why it’s very important to know that you will be staying in the area for at least the next three to five years. Surprise relocations do happen, but that should not stop you from buying a home. Just make sure that you do not plan to make a career switch that would result in a lengthy commute to and from work every day.
5. Can I afford a down payment?
The down payment on your new home may be one of the biggest lump sums of money you have to put down. In addition to a down payment, keep in mind that you will also incur closing costs, insurance, and taxes. If you are like many, you may not have a large amount of money to put toward a down payment. At Launch FCU we offer mortgages for as little as 3% down, allowing you to open doors for less. For more, click here.
The Bottom Line
Owning your home is a great thing. It allows you to start building equity, while also providing you with a sense of pride. In addition, long-term buying is usually cheaper than renting. If you feel like you are ready for home ownership, one of the first things to do is utilize a mortgage calculator to determine how much home you can afford. Then, speak with a friendly Launch FCU Home Loan Specialist to guide you through every step of your home buying journey. Buying a home is a terrific investment when the time is right, and only you know when you are ready to make the leap.
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